Social Security to Discontinue Paper Checks

Zephyrhills, FL (Law Firm Newswire) March 6, 2013 - Social Security checks will soon be phased out in favor of direct deposits.

Beginning on March 1, nearly all Social Security checks will no longer be sent by mail. The change, a cost-cutting measure by the Treasury Department, has irked some, but may benefit others.

Zephyrhills Social Security lawyer Robert Alston commented, “Some 5 million Americans still receive their Social Security benefits by mail. For many of them, this is not a welcome change.”

The two options that will continue to be available for receiving benefits are direct deposit into a bank account or onto a special debit card issued by the Treasury called Direct Express.

The impending change has inspired organization in the form of a group named Consumers for Paper Options. In an email to the Sacramento Bee, the group's president, John Runyan, said that many Social Security beneficiaries do not have bank accounts, and others are simply uncomfortable with electronic banking.

Runyan also testified before a House committee in 2012, saying that senior citizens potentially could be confused by ATMs, PINs, and online statements.

Some, however, are touting the benefits of direct deposits to certain groups, especially the homeless. The Direct Express debit card option does not require a bank account. It also has no user fees and cannot be overcharged.

Electronic payments are safer, says the Treasury. About 10 years ago, a criminal gang in Orange County, California, staked out check-cashing businesses and robbed single women who would habitually cash their Social Security checks on particular days.

Nationwide, 93 percent of beneficiaries already receive direct deposits. The Treasury Department argues that unlike paper checks, electronic payments are easier to trace and can quickly be restored in the event of fraud. The Treasury estimates the move will save $1 billion over the next decade.

Mr. Alston added, “Anyone having difficulty managing any aspect of Social Security, from application to qualification to the receipt of benefits, should contact an experienced Social Security attorney.”